Gibson Energy Announces Sanction of $50 Million Viking Pipeline Project and Revised 2018 Capital Guidance

CALGARY, Alberta, Feb. 21, 2018 (GLOBE NEWSWIRE) -- Gibson Energy Inc. (“Gibson” or the “Company”), (TSX:GEI), announced today the sanction of the $50 million Viking Pipeline Project.

“The Viking Pipeline Project is aligned with our strategy of leveraging our core terminals position to secure complementary growth beyond tankage,” said Steve Spaulding, President and Chief Executive Officer.  “The sanction of the Viking Pipeline Project provides further confidence that we will reach our double-digit distributable cash flow per share growth through the end of 2019 based on projects already under construction and anticipated cost savings.  Additionally, as our prior estimates anticipated the sanction of other projects through the end of 2019, we continue to expect that our growth capital is fully funded from divestiture proceeds.”

Consistent with Gibson’s intention to expand its pipeline gathering network in the Viking Basin by leveraging existing storage, optimization capabilities and access to egress pipelines at its Hardisty Terminal, the Viking Pipeline Project will extend the reach of the existing Provost Pipeline to support development by several regional producers.  The 120 km pipeline will have an initial capacity of 13,300 bbl/d, with the potential to expand to an estimated 25,000 bbl/d in the future.  The Viking Pipeline Project is expected to be in service in Q1 2019, and is underpinned by shippers through take-or-pay commitments with an area of dedication.

Revised Capital Guidance
Reflecting the sanction of the Viking Pipeline Project, Gibson’s 2018 capital expenditure budget is now expected to be allocated as follows:

Growth Capital ($ millions)
Hardisty Terminal	$	90	-	$	110
Edmonton Terminal		25	-		30
Viking Pipeline		45	-		55
Total CDN Infrastructure	$	160	-	$	195
U.S. Infrastructure		5	-		10
Total	$	165	-	$	205
Upgrade and Replacement Capital ($ millions)
Infrastructure	$	15	-	$	20
Logistics(1)		5	-		10
Other		0	-		5

     ⁽¹⁾ Logistics excludes U.S. Environmental Services which is expected to be divested by the end of the first half of 2018.